Bad Credit Car Finance
What’s your monthly budget?
Rates from 9.9% APR. Representative APR 13.9%. We are a credit broker, not a lender.
Representative example: Borrowing £7,500 over 60 months with a representative APR of 13.9%, flat rate of 7.25% and deposit of £0.00, the amount payable is £170.98 per month, with a total cost of £2758.68 and a total amount payable of £10,258.80.
Expert bad credit car finance support
As bad credit specialists, we’re proud to help those others won’t when it comes to car finance. Find out where you stand today with our free eligibility checker.
What is bad credit car finance?
Bad credit car finance is designed for people with poor or limited credit history who may struggle to get standard finance. This could be due to:
Missed or late payments.
Defaults on credit cards or loans.
Bankruptcy.
County Court Judgements (CCJs).
Debt agreements such as IVAs, DMPs or DROs.
Too many hard searches on your credit record.
Because bad credit signals higher risk, lenders are often cautious. Your credit history plays a big role in approval – the stronger it is, the better your chances.
That’s why bad credit finance exists. At Hippo, we work with lenders who consider applications from customers with less-than-perfect credit. Even if you’ve been refused before, we may still be able to help.
The important things to know about bad credit
What is considered a bad credit score?
There’s no set line that defines ‘bad credit’. Most lenders use credit scores from the main three credit reference agencies (CRAs) in the UK: Experian, Equifax and TransUnion. Each has its own scoring system and banding. For example, Experian considers you to have poor credit if your score is lower than 720, while with Equifax, it’s anything lower than 380. If you want to know where you stand, you can check your score with one or more of those CRAs, or you can use our free, no-impact soft credit check to see if you’re likely to be approved for finance through us today.
Can I get car finance with bad credit?
If you’ve never borrowed money or have a limited credit history, you might face the same problems as a bad credit applicant. This is because finance companies don’t know what kind of borrower you’re going to be. So, if you’re a young driver looking to get your first car on finance, the best place to start could be our free soft credit check to see your chances of approval and the sort of deals available.
Can I get car finance with no credit history?
If you’ve never borrowed money or have a limited credit history, you might face the same problems as a bad credit applicant. This is because finance companies don’t know what kind of borrower you’re going to be. So, if you’re a young driver looking to get your first car on finance, the best place to start is with our free soft credit check to see your chances of approval and the sort of deals available.
How does bad credit car finance work?
Deals for bad credit are available across all car finance types, including personal contract purchase (PCP), hire purchase (HP) and leasing (PCH). Regardless of the deal you go for, it’ll work in the same way as a standard contract, but the terms and conditions attached are often different:
- You might find you have to pay a higher interest rate.
- You might not be able to borrow as much, which may limit your options.
- You might need to pay more upfront.
- The approval process will consider your affordability (whether you can afford the repayments), as well as your credit history.
Of course, none of these terms are ideal, but they all help to limit the risk for the lender, which increases your chances of approval.
Can I get a no-deposit finance deal with bad credit?
Yes, some bad credit lenders do offer no-deposit deals. Again, whether you can get one will depend on your application. If you’d like to know more about zero deposit options, you can always speak to a member of the Hippo team.
Does it take longer to get car finance with bad credit?
No, it doesn’t take any longer than normal. Your journey to a finance deal starts with our fast soft credit check. Applying is quick, free and won’t impact your credit score. You’ll typically get a decision in minutes, letting you know if you’ve been pre-approved by one or more of our lenders.
Who is bad credit finance for?
You might want to apply for a bad credit finance deal if:
- You have a poor credit history, including missed payments, defaults, CCJs, IVAs and bankruptcy.
- You have little or no credit history, like new or young drivers.
- You’re self-employed with an irregular income.
- You’ve previously been rejected for car finance.
What are the benefits of bad credit finance?
- Higher chance of approval for those with a poor or limited credit history.
- Paying off your deal on time and in full will help rebuild your credit score.
- More accessible options for applicants struggling with irregular or low income.
Why choose bad credit finance with Hippo?
- As bad credit and zero deposit specialists, we’re perfectly positioned to help you try and find a finance deal that works. We work with finance companies that consider all applications, even if you’ve been refused finance before or have struggled with bankruptcy and CCJs.
- You can check if you’re pre-approved for finance with one or more of our lenders today by using our free, fast, no-impact soft credit check.*
- We’ve got thousands of vehicles in stock and ready to drive away today, with same-day collection or nationwide delivery available on many of our bad credit deals.
- We offer dedicated account managers to all our bad credit customers, with an end-to-end service offering a hassle-free way to finance your car.
Check your eligibility for bad credit finance today with our free soft credit check
Want to know if you can get car finance today? It all starts with our free soft credit check. Applying takes two minutes, won’t affect your credit score* and you’ll typically get a decision from us in minutes.** Once you know where you stand, we can walk you through your options and help you find the best deal possible. If you’re curious about what those might be, you can always give us a call, too.
Bad credit car finance FAQs
How can I improve my credit score?
One of the good things about getting a bad credit finance deal is that it enables you to improve your credit score as you pay it off. Assuming you pay off your deal in full and on time, you might find you come to apply for a new deal with a much stronger credit profile that gives you access to better rates, higher borrowing limits and more vehicle options.
If you’re looking to improve your credit before you apply, here are some things which might help:
- Pay off your existing credit agreements on time.
- Keep your credit utilisation (the amount of credit you use versus the amount available to you) low – such as below 30%.
- Check your credit report to see if there are any mistakes.
- Limit the number of finance applications you make at the same time. Too many applications in a short space of time can cause a dip in your credit score due to the amount of hard credit checks being performed.
- Make sure you’re registered on the electoral roll.
- Check who and what you’re financially linked to – closing any old accounts you no longer use.
- Open a line of credit you can afford to make regular, in-full payments on.
Could a car finance deal affect my credit score?
Yes. There are several ways a finance deal can impact your credit score. Pay off your deal on time, and you’ll probably see your credit score improve – which is one of the big benefits if you’re a bad credit customer looking to improve your score. Likewise, the opposite can happen if you don’t keep up with your payments.
You might find your score dips slightly when you first take out your loan, as a substantial debt has just been added to your credit record.
Can I finance a car without a credit check?
No. FCA rules state that all legitimate finance brokers and lenders should carry out credit and affordability checks to ensure your suitability for a loan.
What paperwork do I need to apply for bad credit finance?
There are three documents we’ll usually need:
- A copy of your driving licence.
- Proof of address.
- Proof of income.
There are the standard pieces of paperwork required for any finance application.
Will applying for car finance affect my credit score?
When you apply for finance properly, you’ll be subject to a hard credit check, which may affect your credit score. A general tip for managing your credit is to not make too many ‘hard’ searches in a short period of time, as this can negatively impact your rating.
Our free soft credit check allows you to see where you stand eligibility-wise without committing to a hard check. It’s quick, easy and, most importantly, won’t affect your credit score. If our soft credit check comes back with the good news that you’ve been pre-approved for finance with one or more of our lenders, you can then choose to formally apply for a finance deal, which is when the hard search takes place.
What if I’m refused car finance?
As bad credit experts, we help plenty of customers who’ve been refused finance elsewhere due to poor credit. While we can’t guarantee approval for anyone, we work with a panel of lenders who specialise in bad credit options. So, if you’ve been refused finance elsewhere, that doesn’t mean you won’t be able to get approved through us.
If, for whatever reason, we can’t help you find a finance deal either, don’t worry; it’s not the end of the road. Credit ratings aren’t fixed. They can be improved over time (see how to improve your credit score above). Likewise, there may be other factors that may help you get a finance deal in the future, like boosting your income or affordability credentials, saving up for a bigger initial payment or adding a guarantor to your deal.
Regardless of the problem, we’ll do our best to help you with realistic, actionable solutions.
Drive away with confidence:
our Used Car Promise
You should always be careful when buying second-hand. The good news is every used car we sell comes with complete peace of mind, thanks to our Used Car Promise. It’s our standard guarantee, and includes:
- 130-point quality check carried out by our onsite technicians.
- 3-month comprehensive warranty.
- 14-day money-back guarantee*** if you change your mind.
- At least 6 months’ MOT remaining on every vehicle
Simple, safe and stress-free used car finance – as it should be.